The United States Securities and Exchange Commission (SEC) has postponed its decision on proposed Solana ETFs by Bitwise, 21Shares, VanEck, Canary Capital, and Fidelity, citing market manipulation and investor protection concerns.
This delay, made public through a filing on May 19, has extended the review process into the second half of 2025 and opened the door to public comments.
Although many in the industry anticipated a more favorable stance following recent approvals for Bitcoin and Ethereum spot ETFs, the SEC has taken a more cautious approach with Solana-based funds.
In addition, despite the delay, investor sentiment around the Solana ecosystem remains resilient, with the price of its native token, SOL, climbing modestly to $167.79 in the aftermath of the announcement.
Public comment period now open
In the May 19 filing, the SEC announced that it would “institute proceedings” to determine whether the proposed rule changes for these Solana ETFs should be approved. This procedural step enables the agency to extend its review timeline while inviting public feedback.
While the institution of proceedings is not an indication of a likely rejection, it reflects the regulator’s heightened scrutiny of crypto investment products beyond Bitcoin and Ethereum.
The SEC explicitly stated that the move does not imply any conclusions regarding the merits of the proposals. Instead, the agency emphasized the need for additional evaluation under the Securities Exchange Act, particularly in relation to fraud prevention and investor safeguards.
This aligns with the SEC’s ongoing efforts to ensure that new financial instruments do not compromise the integrity of US markets.
The market manipulation and legal concerns
A central issue for the SEC is whether these ETFs meet the legal requirements under Section 6(b)(5) of the Exchange Act. This section mandates that exchange-listed products must be designed to prevent fraudulent and manipulative acts while protecting investors and the public interest.
The agency is concerned about the lack of clear market surveillance and potential price manipulation in the Solana trading ecosystem, which may pose risks if replicated in a publicly traded investment vehicle.
Although the SEC has already allowed spot ETFs for Bitcoin (BTC) and Ethereum (ETH), it appears less certain about extending the same treatment to altcoins like Solana (SOL).
While proponents argue that institutional interest and transparent pricing indices such as the CME CF Solana-Dollar Reference Rate and the MarketVector Solana Benchmark Rate offer credibility, the SEC remains unconvinced for now.
Solana ETFs approval odds shift as delays extend into mid-2025
The latest decision affects five different proposals: the 21Shares Core Solana ETF, Bitwise Solana ETF, Canary Solana Trust, VanEck Solana Trust, and the Fidelity Solana Fund.
Although Fidelity’s filing was originally scheduled for a decision by May 24, the SEC has pushed the deadline to July 8.
Meanwhile, the other four proposals had their timelines extended during the May 19 announcement, following a previous delay initiated in March.
According to market observers, including analysts at Bloomberg, the likelihood of approval by July 2025 has dropped significantly.
On Polymarket, a blockchain-based prediction platform, odds of a green light by the end of July now stand at only 84%, down from 90% towards the end of April.
However, optimism remains for a longer-term outcome, with approval chances for December 2025 estimated as high as 85%, suggesting that regulatory clarity may eventually arrive.